Standard Setting in a Political EnvironmentWhen it comes to influencing the development of accounting standards, the most powerful force may be the stakeholder. Accounting standards are affected by political action, not just careful logic or research findings. As part of their mandate, standard setters include stakeholders as members, giving them a formal voice in the process. Furthermore, through due process, interested parties can comment on proposed changes or new standards. This is generally a good thing.However, stakeholders may want particular economic events to be accounted for or reported in a particular way, and they may fight hard to get what they want. They know that the most effective way to influence the standards that dictate accounting practice is to participate in formulating them or to try to influence or persuade the formulator. This is not necessarily optimal since the stakeholders who make themselves heard the loudest may get their way, to the detriment of others.Should lobbying by stakeholders play a role in setting financial accounting and reporting standards? The AcSB and IASB do not exist in isolation. Standard setting is part of the real world, and it cannot escape politics and political pressures. That is not to say that stakeholders should not have a say. Since many accounting standards do have economic consequences, it is not surprising that special interest groups become vocal and critical (some supporting, some opposing) when standards are b